Management & Operations

N.Y. MTA buys insurance protection for future 'Sandy' storms

Posted on July 31, 2013

New York CVB photo by Joe Buglewicz
New York CVB photo by Joe Buglewicz
The Metropolitan Transportation Authority (MTA) has secured $200 million of insurance protection that will help pay for future repairs for damage to its infrastructure in the event of a storm featuring destructive storm surges similar to those experienced during Superstorm Sandy. The insurance protection has been funded through the offering of “catastrophe bonds” by MetroCat Re Ltd., a special purpose insurer.

This is the first time that the MTA has accessed the capital markets to manage its property damage risks, and it is the first catastrophe bond ever issued to protect solely against storm surge. The MTA’s premium cost is well below quotes that MTA received this spring for traditional property coverage.

“In the aftermath of Superstorm Sandy, the traditional avenues we use for insurance and reinsurance contracted dramatically, making it exceedingly difficult for the MTA to obtain insurance,” said MTA Chairman/CEO Thomas F. Prendergast. “But as a result of this savvy and novel reinsurance arrangement, we are now in a stronger position should our area, God forbid, face another large-scale storm-surge event within the next three years.”

The transaction provides protection in the unlikely event that the water level reaches designated heights in the New York City Metropolitan Region during any hurricane, tropical cyclone or tropical storm through August 5, 2016.



 


View comments or post a comment on this story. (0 Comments)

More News

SFRTA taps new deputy executive director

C. Mikel Oglesby brings almost a quarter of a century of experience in the transit industry to his position, most recently operating Oglesby Consulting LLC, a firm he established to provide transportation expertise to the public and private sectors.

CDTA unveils Navigator smart card brand

The new smart card is expected to begin public pilot testing later this year and will be fully deployed once testing is complete.

‘Living Lab’ for Transit Innovation Opens in Santa Clara, Calif.

The new initiative aims to rethink how VTA delivers bus, rail, roadway and other transportation services, said Santa Clara VTA GM Nuria Fernandez. As a catalyst for ingenuity, the center intends to pair itself with academics, startups, tech firms and nonprofits from the region. The center also will operate the VTA’s open data portal.

Interim MBTA boss vows all-hands-on-deck mentality for snowstorms

Frank DePaola, who was named to replace outgoing MBTA chief Beverly Scott, has already created a team to examine what went wrong this winter.

Public Transportation users save $9,238 annually

APTA releases this monthly Transit Savings Report to examine how an individual in a two-person household can save money by taking public transportation and living with one less car.

See More News

Post a Comment

Post Comment

Comments (0)

Please sign in or register to .    Close